As SpaceX released its second-ever public earnings report Tuesday, Elon Musk declared his support for combining the aerospace and AI company with his electric vehicle company, Tesla. He said both companies had created special committees to explore a potential merger, but have not reached any agreement on terms of a transaction.
"Both SpaceX and Tesla have formed special committees to discuss this idea at the request of shareholders and these special committees are, uh, consist of independent directors," Musk said on the call. "Because I'm a conflicted party, I can't actually be in the discussions of the special committees."
Musk also expressed his backing for the move, while cautioning about the hurdles involved achieve it. He stated that it would require the approval of 50% of all Tesla shareholders.
"I think some people out there assume that a SpaceX and Tesla merger is a certainty and I think that would be overstating it," Musk said, adding it would require shareholder approvals and special committees at both firms. "I do think there's a lot of merit to combining the companies."
The company revealed a far better financial quarter than Wall Street projected. SpaceX company, which encompasses rockets, artificial intelligence and satellite communications, reported a 161% growth in revenue year over year, driven by its Starlink and AI segments.
The company declared $14.58bn in revenue against analysts' projected $12.72bn. SpaceX reported earnings per share of 35 cents and a net income of $4.4bn. The company's stock, which started the day down around 8% for the year, shot up 2% in after hours trading immediately after the results.
Musk appeared alongside SpaceX president Gwynne Shotwell and CFO Bret Johnsen at his Starlink factory in Texas to deliver the earnings report, touting the company's growth and plans for future rocket developments. Musk also highlighted its artificial intelligence segment, which the company refers to as Super Intelligence, that drew $7.6bn in revenue and now outperforms its Connectivity business, which provides internet services.
Musk's company once again found itself in the spotlight in recent weeks as investors have speculated about the potential merger with Tesla, the second-most valuable part of the tech mogul's empire. Musk has also been at the center of geopolitical tensions after Volodymyr Zelenskyy, Ukraine's president, last week accused SpaceX of restricting access to its military-grade Starlink internet service.
The disruption in service to StarShield allegedly led to several failed Ukrainian combat missions and left the country more vulnerable to Russian drone attacks, as well as highlighted how global internet infrastructure has come to rely on Musk's products. Musk denied responsibility for the disruption, stating that StarShield was controlled by the US government, not SpaceX. The White House has likewise denied hobbling StarShield.
Moments before the SpaceX earnings call on Tuesday, the Wall Street Journal reported that Musk personally ordered the throttling of StarShield, citing unnamed US officials and people familiar with the matter. Musk faced no questions about the reports on the investor Q&A portion of SpaceX's earnings call.
While SpaceX's role in international affairs faces scrutiny, Musk has taken on a resurgent role in US domestic politics. The world's richest person has contributed $366m in political spending this election cycle, backing Republican-aligned Super Pacs and pouring money into influencing key midterm races. Musk also agreed earlier this month to co-lead a Pentagon project on the future of warfare, bringing him back into government work after his time as the de facto leader of the so-called "department of government efficiency" (Doge).
Musk recently pledged to give every child in the US one of his SpaceX stocks next year, which Donald Trump stated would be facilitated through the president's "Trump accounts" initiative that creates savings plans for children. The prospective share giveaway is a rare display of philanthropy from Musk, who has criticized traditional aid organizations and has taken credit for dismantling the world's largest single provider of humanitarian aid by gutting the government agency USAID.
"Giving shares, which are stakes in the future economy, directly to the people is the way," Musk posted on X, the social media company he owns.
Tech leaders such as Musk have faced increasing public pushback over their extraordinary accumulation of wealth and power in the US, while this year AI firms OpenAI and Anthropic both announced big investments to their grant-making and non-profit arms. Musk's announcement came after Anthropic announced earlier this week that it plans to donate 5% of its shares to a newly created public benefit fund within the company.
Tesla will also reveal its latest earnings this week, with Musk set to deliver the quarterly report on Wednesday. The company's stock received a slight boost this week after it unveiled its new Tesla Roadster 2 electric sports car, which Musk showcased in a dramatic demonstration that included the vehicle using pressurized air tanks to briefly lift off the ground and perform aerial stunts.